Lawyers for the family of the poisoned Russian dissident, who was working for MI6 prior to his 2006 death in London, warned the actions of the two governments should be treated with the "greatest degree of scepticism".

William Hague, the Foreign Secretary, has signed a broad Public Interest Immunity (PII) certificate to prevent significant evidence from being heard in public, the pre-inquest was told.

Such orders are only issued on the grounds of national security, the hearing, being held at London's Royal Courts of Justice, was told. The nature of the evidence has not been disclosed.

But his family and British media organisations, including The Daily Telegraph, are against the move, challenging Mr Hague's submissions to conceal sensitive documents and have parts of the inquest heard in secret.

Sir Robert Own, a senior judge sitting as the coroner, was today hearing applications from interested parties over whether evidence held by the British government should be concealed from the public.

Ben Emmerson, QC, representing Mr Litvinenko’s widow Marina, suggested today that both the British and Russian governments were conspiring to shut down the inquest to preserve crucial trade interests.

Referring to images of Russian President Vladimir Putin and Prime Minister David Cameron seen together at the Olympics in the summer, he said any claims that there was a risk to the public should be treated with the "greatest degree of scepticism".

He suggested attempts to withhold evidence pointed towards a conspiracy at the highest levels of government.

“The British government, like the Russian government, is conspiring to get this inquest closed down in exchange for substantial trade interests which we know Mr Cameron is pursuing," he said.

"One has to ask what is going on at the highest level of Her Majesty's Government, particularly when the highest levels are building bridges with the Kremlin."

He called on the Government to provide more detail relating to the information it wanted to withhold, to avoid the "frightening prospect" of proceedings being "suborned to the Russian Federation".

He added: "We cannot allow Her Majesty's Government, by misusing the PII system, to use this inquest to dance to the Russian tarantella."

The coroner hinted that the inquest into his murder was unlikely to open on May 1 due to the complexity of the investigation which must conclude ahead of the inquest's formal opening.

Mr Litvinenko’s widow expressed dismay that the inquest into his death may be further delayed.

Mr Emmerson warned that he should not allow the legal process to be "bogged down" by the "Government's attempt to keep a lid on the truth".

He added: "It is the Government's secret files that are delaying this inquest. We know nothing about why these applications are being made and we are dancing in the dark."

Mr Emerson had previously told Sir Robert that Mr Litvinenko was working for MI6 while in the UK.

He said he was regularly tasked by “Martin” and had a specific phone to only contact him on.

Mrs Litvinenko, who appeared to listen intently to the legal discussions during the two-and-a-half hour hearing, has claimed money was regularly paid in to the couple’s joint bank account.

Mr Emerson QC has also claimed he was working with Andrei Lugovoi, the former KGB bodyguard who is the prime suspect in his death.

Mr Litvinenko, a former KGB agent, was allegedly poisoned by radioactive polonium – 210 while drinking tea during a meeting with former security colleagues at the Millennium Hotel in Grosvenor Square in November 2006.

He died three weeks later in University College Hospital.

In evidence submitted at a previous hearing, it emerged that the British Government concluded there was prima facie evidence that the Russian state was involved in Mr Litvinenko’s death.

Prosecutors named Lugovy as the main suspect but Russia has refused to extradite him to Britain for questioning.

The hearing continues tomorrow when the judge is expected to rule whether the government can keep evidence secret.